Grantmaking Foundations
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 11,600 grantmaking foundations in the US award grants from trust funds to support charitable activities. Top areas of focus for giving include healthcare, education, human services, public affairs, arts and culture, environmental causes and animals, and international affairs.
Market Risk Challenges Investments
Fluctuations in interest rates, corporate earnings, and global financial markets can create a challenging investment environment for foundations.
Facing Public Scrutiny
Grantmaking foundations, particularly public foundations, face scrutiny from the public to provide transparency.
Industry size & Structure
The average grantmaking foundation operates out of a single location, employs about nine workers, and generates $7 million annually.
- According to the US government, the grantmaking foundation industry consists of about 11,600 firms that employ 104,800 workers and generates $86 billion in revenue.
- The 238 US foundations surveyed in 2019 received over $9.4 billion in gifts, distributed nearly $8.4 billion to organizations and individuals, and managed over $94.1 billion in assets, according to Candid and the Columbus Survey.
- The top 50 organizations account for about 38% of industry revenue.
- Large organizations include the Bill and Melinda Gates Foundation, the Ford Foundation, and the Silicon Valley Community Foundation (SVCF).
- Most foundations have less than $50 million in assets.
Industry Forecast
Grantmaking Foundations Industry Growth
Source: Vertical IQ and Inforum
Coronavirus Update
May 8, 2022 - Charitable Giving Increased In 2021
- Charitable Giving increased 2.7% year over year in 2021, surpassing the unprecedented increase of 2020, according to the Fundraising Effectiveness Project. New retained donors – those who gave to a particular organization for the first time in 2020 and then continued giving to that organization in 2021 – increased 26% during the period while the total number of donors decreased 5.7%.
- Flexible funding, which provides grantees the freedom to make the best choices and adapt to changing conditions, was a critical factor in allowing grantees to adjust to pandemic conditions, according to a survey of grantees by the Hewlett Foundation and the Center for Effective Philanthropy (CEP). The survey also showed, however, that while grantees were aware of broad foundation-level actions related to the pandemic, there was considerable variance in their awareness and understanding of individual programs and strategies.
- Private foundations have stepped up to help battle the pandemic by providing millions in funding for outbreak-related research, food insecurity, and other emergency relief needs. Candid, a non-profit that collects data on philanthropies, has identified nearly 73,000 grants and pledges totaling more than $27 billion in response to the coronavirus to date.
- Charitable giving was up in 2021 but the pandemic put a dent in volunteering. Just over 80% of Americans say they donated to charity in 2021, compared to 73% who did so in 2020, according to a Gallup poll released in January.The percentage of Americans who say they volunteered slipped to 56% in 2021 from 58% in 2020, however. While giving levels in 2021 were consistent across all income groups, volunteering saw the biggest dip among households with incomes of $100,000 or more. Both giving and volunteerism remained below pre-pandemic levels in 2021.
- Eight large foundations have repeated calls to improve vaccine availability for poorer nations. Leaders of foundations including the Rockefeller Foundation, the Children’s Investment Fund, and the Conrad N. Hilton Foundation called on the G7 forum of wealthy nations to do more to make COVID-19 vaccines and treatments more widely available and urged the waiving of intellectual property rights on vaccines to speed their manufacture and distribution.
- Some key changes foundations made in response to the pandemic are likely to remain in place long-term, according to a recent survey report by the Center for Effective Philanthropy. More than 60% of foundation leaders said a higher percentage of their grant dollars were unrestricted compared to pre-pandemic levels. Of that group, two-thirds said they plan to stick with higher levels of unrestricted grant dollars moving forward. Most foundation leaders also said racial equity is more of a concern and have changed policies to address it, including more funding for organizations that support Back and Latino communities.
- Grantmaking foundations have increased salaries despite pandemic-related difficulties, according to a recent survey by the Council on Foundations. The vast majority of foundations surveyed – about 85% - said they gave their staff raises in 2020. All survey respondents said they planned to provide salary increases again in 2021 or had already done so. Median pay increases for staff were on par with the inflation rate, or about 3% for both 2020 and 2021. Raises for grantmaking foundation CEOs and program officers were about 4% and 5%, respectively.
- The World Health Organization (WHO) Foundation, along with the Bill & Melinda Gates Foundation, launched a global mass fundraising campaign to help Covax, the international effort to distribute COVID-19 vaccines to low-income countries. The “Go Give One” drive aims to raise billions of dollars in small donations with the help of corporations, religious organizations, and world leaders. Covax was initially funded by the WHO, UNICEF, and other global health agencies. The Go Give One campaign will cooperate with healthcare systems and mass vaccination sites to advertise the program. The campaign also aims to work with corporations to help them promote Go Give One to their employees and customers through corporate social media platforms.
- Fewer nonprofit organizations that serve people with low to moderate incomes continue to report “significant disruption” due to the pandemic, according to a December 2021 report by the Federal Reserve. Just over a third of nonprofits serving low- to moderate-income people said that they continued to face significant disruption compared to 71% who reported significant disruptions during the peak of their pandemic-related stress. Some 94% said they still faced some level of disruption, however. About 47% of organizations said that their revenue increased during the pandemic and an equal percentage reported declines in revenue. More than 70% of nonprofits said that demand for services increased during the pandemic. Many of the more than 2,500 nonprofits participating in the study provide housing, health care, education, and child welfare services.
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